Chapter 20 Fill in the Blank Part A+B

During the current year, 12,500 units were sold at a variable cost of goods sold of $187,500. The sales were planned for 12,000 units at a variable cost of goods sold of $192,000. - The amount of difference between the actual and planned variable cost of goods sold due to the unit cost factor is _________________________ (designate amount and direction).

$12,500 decrease in variable cost of goods sold

Unlike absorption costing, the variable costing concept treats __________ _____________ ______________ as a period expense.

fixed factory overhead

In the absorption costing income statement, deducting the cost of goods sold from sales yields the _________ ___________.

gross profit

Direct labor would be______________ (included or excluded) in determining the cost of product under the variable costing concept.

included

If the per unit variable selling and administrative expenses were planned to be $2.25 per unit, but were actually $2.00 per unit, then the unit cost factor would result in a(n) ______________ (increase or decrease) in contribution margin between planned and actual.

increase

The income from operations under absorption costing will be ___________________ (equal to, greater than, or less than) the income from operations under variable costing when the units sold exceed the units produced.

less than

The_________________(absorption or variable) costing concept is useful to management in analyzing short-run pricing plans.

variable

In the variable costing income statement, deducting_______________ ___________ _______ ___________ ___________ from sales yields the manufacturing margin.

variable cost of goods sold

Baskins and Taylor are two salespersons that sell Products A and B. The contribution margin of Product A is $40 per unit, while for Product B it is $70 per unit. The total sales volume for both products for each salesperson is as follows: Product A: Baskins ............................ 12,000 units Product A: Taylor ............................. 8,000 Product B: Baskins ............................ 10,000 units Product B: Taylor ............................... 15,000 units - The contribution margin for Taylor is_____________

$1,370,000 [(8,000 × $40) + (15,000 × $70)]

During the current year, 20,000 units were sold at a variable cost of goods sold of $320,000. The sales were planned for 21,500 units at a variable cost of goods sold of $333,250. - The amount of difference between the actual and planned variable cost of goods sold due to the unit cost factor is _______________________ (designate amount and direction).

$10,000 increase in variable cost of goods sold

A business operated at 100% of capacity during its first month of operations with the following results: Sales (22,500 units) ....................................................... $1,125,000 Manufacturing costs (25,000 units): Direct materials .............................. $300,000 Direct labor ...................................... 250,000 Variable factory overhead .......... 200,000 Fixed factory overhead ................. 150,000 ................ 900,000 Selling and administrative expenses: Variable .......................................... $146,250 Fixed .................................................. 67,500 ...................... 213,750 - The amount of income from operations that would be reported on the absorption costing income statement is _____________.

$101,250

At the end of the first year of operations, 3,500 units remained in finished goods inventory. The unit manufacturing costs during the year were as follows: unit costs: Direct materials ............................... $22 Direct labor ...................................... 20 Variable factory overhead ............... 10 Fixed factory overhead ................... 4 - The cost of the finished goods inventory reported on the balance sheet under the variable costing income statement is _____________.

$182,000 (3,500 × $52)

A business operated at 100% of capacity during its first month of operations with the following results: Sales (14,000 units) ...................................................... $840,000 Manufacturing costs (16,000 units): Direct materials .............................. $256,000 Direct labor ........................................ 224,000 Variable factory overhead .......... 128,000 Fixed factory overhead ................. 80,000.............. 688,000 Selling and administrative expenses: Variable .......................................... $119,000 Fixed .................................................. 56,000................... 175,000 - The amount of contribution margin that would be reported on the variable costing income statement is _____________.

$189,000

At the end of the first year of operations, 3,500 units remained in finished goods inventory. The unit manufacturing costs during the year were as follows: unit costs: Direct materials ............................... $22 Direct labor ...................................... 20 Variable factory overhead ............... 10 Fixed factory overhead ................... 4 - The cost of the finished goods inventory reported on the balance sheet under the absorption costing income statement is _____________.

$196,000 (3,500 × $56)

During the current year, 20,000 units were sold at a variable cost of goods sold of $320,000. The sales were planned for 21,500 units at a variable cost of goods sold of $333,250. - The amount of difference between the actual and planned variable cost of goods sold due to the quantity factor is _______________________ (designate amount and direction).

$23,250 decrease in variable cost of goods sold

If the instructional cost per student credit hour were planned at $140 per credit hour, but the actual cost was $155 per credit hour for 34,500 actual student credit hours, then the unit cost factor would result in a ______________ (amount) _______________ (increase or decrease) in contribution margin between planned and actual.

$517,500 decrease

A business operated at 100% of capacity during its first month of operations with the following results: Sales (22,500 units) ....................................................... $1,125,000 Manufacturing costs (25,000 units): Direct materials .............................. $300,000 Direct labor ...................................... 250,000 Variable factory overhead .......... 200,000 Fixed factory overhead ................. 150,000 ................ 900,000 Selling and administrative expenses: Variable .......................................... $146,250 Fixed .................................................. 67,500 ...................... 213,750 - The amount of contribution margin that would be reported on the variable costing income statement is _____________.

$303,750

A business operated at 100% of capacity during its first month of operations with the following results: Sales (14,000 units) ...................................................... $840,000 Manufacturing costs (16,000 units): Direct materials .............................. $256,000 Direct labor ........................................ 224,000 Variable factory overhead .......... 128,000 Fixed factory overhead ................. 80,000.............. 688,000 Selling and administrative expenses: Variable .......................................... $119,000 Fixed .................................................. 56,000................... 175,000 - The amount of the manufacturing margin that would be reported on the variable costing income statement is _____________.

$308,000

If 67,000 miles were planned by a trucking company for the period, but 64,000 miles were actually run at a cost of $1.40 per mile, then the quantity factor would result in a _____________ (amount) ______________ (increase or decrease) in contribution margin between planned and actual.

$4,200 decrease

At the end of the first year of operations, 5,000 units remained in finished goods inventory. The unit manufacturing costs during the year were as follows: Unit Costs: Direct materials ............................... $45 Direct labor ...................................... 26 Variable factory overhead ............... 12 Fixed factory overhead ................... 8 - The cost of the finished goods inventory reported on the balance sheet under the variable costing income statement is _____________.

$415,000 (5,000 × $83)

A business operated at 100% of capacity during its first month of operations with the following results: Sales (22,500 units) ....................................................... $1,125,000 Manufacturing costs (25,000 units): Direct materials .............................. $300,000 Direct labor ...................................... 250,000 Variable factory overhead .......... 200,000 Fixed factory overhead ................. 150,000 ................ 900,000 Selling and administrative expenses: Variable .......................................... $146,250 Fixed .................................................. 67,500 ...................... 213,750 - The amount of the manufacturing margin that would be reported on the variable costing income statement is _____________.

$450,000

At the end of the first year of operations, 5,000 units remained in finished goods inventory. The unit manufacturing costs during the year were as follows: Unit Costs: Direct materials ............................... $45 Direct labor ...................................... 26 Variable factory overhead ............... 12 Fixed factory overhead ................... 8 - The cost of the finished goods inventory reported on the balance sheet under the absorption costing income statement is _________

$455,000 (5,000 × $91)

A business operated at 100% of capacity during its first month of operations with the following results: Sales (14,000 units) ...................................................... $840,000 Manufacturing costs (16,000 units): Direct materials .............................. $256,000 Direct labor ........................................ 224,000 Variable factory overhead .......... 128,000 Fixed factory overhead ................. 80,000.............. 688,000 Selling and administrative expenses: Variable .......................................... $119,000 Fixed .................................................. 56,000................... 175,000 - The amount of income from operations that would be reported on the variable costing income statement is _____________.

$53,000

If the finished goods inventory was 3,000 units after the first month of operations and the fixed factory overhead was $6 per unit, then the income from operations under absorption costing is _____________ (amount) ___________________ (less than or greater than) the income from operations under variable costing.

$6 x 3,000 = $18,000 $18,000, greater than

The production volume was 10,000 units, while the sales volume was 12,000 units. The sales price was $40 per unit. The variable cost of goods sold was $28 per unit, and the variable selling and administrative expenses were $7 per unit. The contribution margin shown on the variable costing income statement is ___________.

$60,000 (12,000 × $5)

A business operated at 100% of capacity during its first month of operations with the following results: Sales (14,000 units) ...................................................... $840,000 Manufacturing costs (16,000 units): Direct materials .............................. $256,000 Direct labor ........................................ 224,000 Variable factory overhead .......... 128,000 Fixed factory overhead ................. 80,000.............. 688,000 Selling and administrative expenses: Variable .......................................... $119,000 Fixed .................................................. 56,000................... 175,000 - The amount of income from operations that would be reported on the absorption costing income statement is _____________.

$63,000

During the current year, 12,500 units were sold at a variable cost of goods sold of $187,500. The sales were planned for 12,000 units at a variable cost of goods sold of $192,000. - The amount of difference between the actual and planned variable cost of goods sold due to the quantity factor is _________________________ (designate amount and direction

$8,000 increase in variable cost of goods sold

Baskins and Taylor are two salespersons that sell Products A and B. The contribution margin of Product A is $40 per unit, while for Product B it is $70 per unit. The total sales volume for both products for each salesperson is as follows: Product A: Baskins ............................ 12,000 units Product A: Taylor ............................. 8,000 Product B: Baskins ............................ 10,000 units Product B: Taylor ............................... 15,000 units - The contribution margin for Product A is_____________

$800,000 (20,000 × $40)

A business operated at 100% of capacity during its first month of operations with the following results: Sales (22,500 units) ....................................................... $1,125,000 Manufacturing costs (25,000 units): Direct materials .............................. $300,000 Direct labor ...................................... 250,000 Variable factory overhead .......... 200,000 Fixed factory overhead ................. 150,000 ................ 900,000 Selling and administrative expenses: Variable .......................................... $146,250 Fixed .................................................. 67,500 ...................... 213,750 - The amount of income from operations that would be reported on the variable costing income statement is _____________.

$86,250

Generally accepted accounting principles require use of the _______________ (absorption or variable) concept in determining the cost of goods sold.

absorption

The_________________(absorption or variable) costing concept is useful to management in analyzing long-run production plans.

absorption

The_________________(absorption or variable) costing concept will yield a higher operating income for a period when the number of units manufactured exceeds the units sold.

absorption

The term applied to the conventional concept that includes both fixed and variable manufacturing costs as part of the cost of products manufactured is _________________ ___________.

absorption costing

In the variable costing income statement, deducting variable operating expenses from manufacturing margin yields the ___________________ ____________.

contribution margin

For a specific level of management, __________________ _________ are costs that can be influenced by management at that level.

controllable costs

Straight-line depreciation on the factory building would be ______________ (included or excluded) in determining the cost of product under the variable costing concept.

excluded

In the variable costing income statement, deducting variable cost of goods sold from sales yields the ___________________ ____________.

manufacturing margin

In contribution margin analysis, the factor that is responsible for an increase in the amount of sales due to an increase in price is termed the _____________ _____________.

price factor

Unlike variable costing, absorption costing treats fixed factory overhead as a(n) _____________ cost.

product

In contribution margin analysis, the factor that is responsible for an increase in the amount of sales due to an increase in unit volume is termed the ______________ ______________.

quantity factor

The __________ ________ refers to the relative distribution of sales among the various products sold.

sales mix